EMERGING MARKETS-Chilean peso up with copper prices; real flat

Tue Sep 25, 2012 1:31pm EDT

* Brazil's Rousseff says Fed policies hurting exporters
    * Mexican peso 0.3 pct higher; Brazilian real flat

    RIO DE JANEIRO, Sept 25 (Reuters) - The Chilean peso led
Latin American currencies higher on Tuesday as rising prices of
copper, Chile's main export, lifted the currency from a two-week
low.
    The Brazilian real was little changed for a seventh straight
session on fear of central bank intervention.
    The Chilean peso jumped 1.2 percent to 470.00 per
dollar, after closing on Monday at 475.70, its weakest LEVEL
since Sept. 7. Copper prices were 1.2 percent higher on
the London Metal Exchange.
    "I believe the peso hit bottom on Monday. Now it's going up,
following higher copper prices," said Carlos Martinez, head of
the currency desk at Vantrust Capital in Santiago.
    The Mexican peso gained 0.5 percent, recovering part
of the 1.6 percent loss recorded during the past six sessions.
    The Brazilian real  was practically unchanged at
2.025 per dollar, however, as fears of central bank intervention
drastically reduced volatility in the local foreign exchange
market.
    "The central bank interventions in the FX market have scared
investors," said Reginaldo Galhardo, manager of the currency
desk at Treviso brokerage in Sao Paulo.
    Brazilian policymakers have pledged to move aggressively to
offset expected capital inflows resulting from the stimulus
measures deployed by the U.S. Federal Reserve and the European
Central Bank. The inflows could drive up the value of the real,
potentially hurting Brazilian exporters.  
    In the latest sign that Brazil will do whatever it takes to
curb currency gains and protect exporters, President Dilma
Rousseff on Tuesday told the United Nations that "legitimate"
trade defense initiatives by developing countries can not be
classified as protectionism. 
    Expectations of higher dollar inflows to emerging markets
were on the rise, however, after a top U.S. Federal Reserve
policy maker late on Monday said he expects the central bank to
expand its bond-buying program next year. 

    Latin American FX prices at 1720 GMT:
    
 Currencies                         daily %    YTD %
                                     change   change
                            Latest           
 Brazil real                2.0250     0.02    -7.73
                                             
 Mexico peso               12.8490     0.47     8.72
                                             
 Argentina peso*            6.2900     0.48   -24.80
                                             
 Chile peso               470.0000     1.21    10.49
                                             
 Colombia peso          1,795.9000     0.27     7.93
                                             
 Peru sol                   2.5960     0.00     3.89
                                             
 * Argentine peso's rate between                    
 brokerages
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